It’s the New Year and for many people that means one thing – New Year’s resolutions. Generally when you think of New Year’s resolutions you’ll think of something health related; be it signing up to the gym or organising a healthy eating regime. However, more and more people are opting to take on resolutions that will have a positive impact on their personal finances.
In the current economic climate, it seems like a great idea for people to take action to rectify their poor financial situations and what better time to start than at the beginning of the year? Christmas is an expensive time of year for many of us, so January seems as good a time as any to start changing those bad financial habits. We’ve listed a few things that you can do in order to make a start with your financial New Year’s resolution.
First and foremost, you should consider drawing up a budget plan. Calculate exactly how much disposable cash you have after all of your essential outgoings have been deducted from your income. With this calculation in mind, you should be able to start living within your means, which is essential if you wish to avoid worsening your financial situation. At first you may find that sticking to your budget is demanding and you will have to make some sacrifices, but this will get easier over time.
If you have a bit of extra cash at the end of the month, perhaps you could put it towards paying off any debts. Don’t just stick to minimum monthly repayments if you can afford to. The quicker you can pay off your debts, the less you’ll be paying in interest and the quicker you can start earning interest on savings.
It might sound obvious but saving is the key to financial success. It is recommended that you save 10% of your income. Once you are debt-free, this can be done with little effort. The money that was being spent on repaying credit cards, loans etc. could be put into a savings account and actually earn you interest! Furthermore, you could carry out some research into investing your money, which could help your savings grow at a quicker rate.
The first port of call is to clear any outstanding debts and then you can start thinking about planning your finances for the future. If you want to clear your debts, you might want to consider a debt management plan or an IVA. Contact Money Solve today to find out more about your options.